Russian Industry and Trade Ministry considering possibility of granting metallurgy companies 3-month moratorium on payment of steel excise tax, MET

MOSCOW. Sept 19 (Interfax) - The Industry and Trade Ministry, instead of indexing the cut-off price for the steel excise tax which metallurgy companies had requested, is now considering the possibility of granting a deferral on the payment of this excise tax for a period of three months for vertically integrated metallurgical companies, as well as a deferral on the payment of the mineral extraction tax (MET).

"By analogy with the coal industry, and taking into account the appeals received from metallurgical companies, the possibility of granting a three-month deferral on payments for the excise tax on liquid steel and the MET on iron ore raw materials is being considered," the ministry told Interfax.

On Monday, September 15, Deputy Finance Minister Alexei Sazanov told journalists that the Finance Ministry is against indexing the cut-off price when calculating the excise tax.

"The cut-off will not be increased. The Finance Ministry is against it. The Finance Ministry does not support changing the cut-off; the budget situation does not currently allow for indexing the cut-off," Sazanov told journalists.

The fact that the Russian government might introduce an adjustment to the parameters for calculating the steel excise tax, taking into account raw material and non-raw material components, was discussed at the Industry and Trade Ministry in the spring this year. In June, Industry and Trade Minister Anton Alikhanov said in an interview with Interfax that Russian ministries continue to work on adjusting the formula for calculating the steel excise tax, and a new threshold value will be introduced from January 2026.

"Amendments to the Tax Code on indexing the cut-off price for slabs from January 1, 2026, below which the excise tax on liquid steel is not paid, are already in progress; the parameters of this adjustment are currently being worked out," Alikhanov said in the summer.

The head of Severstal , Alexander Shevelev, told Interfax on the sidelines of the 2025 St. Petersburg International Economic Forum that metallurgy companies propose not to fix the cut-off price when calculating the steel excise tax, but to index the price of 30,000 rubles established in 2022, taking into account accumulated inflation.

"We have submitted our proposals to the relevant ministries; they are still being discussed. We do not know what the final decision on the excise tax will be. Our proposal is that if it is not possible to cancel this outdated measure, which was introduced as a tax on windfall profits, which is now out of the question, then at least approve a formula for indexing the slab cut-off price of 30,000 rubles," Shevelev said. "We consider it fair to use the cut-off price established in 2022, taking into account the accumulated inflation over four years, for the calculation and to ensure its indexing in the future."

According to the Russian Steel Association, the cost of slab even for the most efficient Russian metallurgical plants exceeded 40,000 rubles per tonne in 2024. Metallurgy companies proposed using the cut-off level approved in 2022 of 30,000 rubles and indexing it for the accumulated inflation over four years, from 2022 to 2025 inclusive.